Banks are approving more loans, but companies aren’t taking even half the money, bankers rue.
SS Ranjan, deputy MD and CFO, State Bank of India said, “Our sanctions grew by around Rs 60,000 crores in the last financial year. Of that undisbursed loans stand at about Rs 45,000 crores”.
It means SBI hasn’t commenced earning interest on ¾ of the loan amount it approved previous year.
The story is the repeated at Bank of India, where approvals were Rs 48,000 crore on March 31 this year.
M Narendra, executive director of the bank said, “Our undisbursed sanctions are about Rs 25,000 crore. Projects are taking time to get implemented. We charged an average interest of 10% on what we disbursed.”
Things are the same at private sector and smaller banks. Jaideep Iyer, president, financial management at Yes Bank said the bank has apporved Rs 22,000 crore in the previous financial year, which is 73% higher than in fiscal 2009, but 2/3 of the amount or about Rs 15,000 crore, is undisbursed.
This is due to corporate projects run into various snags due to which the companies refuse to pick up the loans.
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